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Doing Business in Cambodia • Business Risk 91 • Getting Paid in Cambodia

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Doing Business in Cambodia • Business Risk 91 • Getting Paid in Cambodia Doing Business in Cambodia k u Phnom Penh Cityscape with the . o c King's Royal Palace in the foreground . e d i u G s s e n i s u B g n i o D . a i d o b m a C . w w w www.Cambodia.DoingBusinessGuide.co.uk Visit the Website and download the free Mobile App SUPPORTED BY: SUPPORTED BY: CONTENTS 7 Cambodia overview 9 Welcome from Lesley Batchelor OBE, FIEx (Grad) – Director General, Institute of Export & International Trade 11 Foreword from Mr Bill Longhurst, British Ambassador to Cambodia 13 Introduction from Romdoul May, Director of the Department for International Trade, Cambodia 15 Introduction from Ross Hunter, Executive Director, UK-ASEAN Business Council 25 Why Cambodia? 17 About the British Chamber of Commerce, Cambodia (BritCham) 19 About the Department for International Trade (DIT) 23 About this Guide www. Cambodia .Doing Business Guide .co.uk 3 35 Help available 25 Why Cambodia? for you 26 • Summary 27 • Geography • General overview 28 • Government overview • Economic overview 35 Help available for you 37 • Overview • Support from the Department for International Trade (DIT) 40 • Support from the Institute of Export & International Trade 41 • Support from the BritCham Cambodia 42 • Support from the UK-ASEAN Business Council (UKABC) 47 Getting here and advice about your stay 49 • Entry requirements for Cambodia 50 • Money 51 • Local laws and customs 52 • Safety and security 54 • Local travel 56 • Health 57 • Travel advice for Cambodia 59 Sector-specific opportunities 61 • Research • Agriculture sector • Construction sector 62 • Education sector 63 • Retail sector 65 Preparing to export 66 • Consultation and bespoke research 67 • Start-up considerations CONTENTS 47 68 • Setting up a business in Cambodia 69 • Getting finance to fulfil an export contract to Cambodia 71 How to do business in Cambodia 72 • Legal considerations • Standards and technical regulations 59 74 • Taxation 75 • Customs and documentation 77 • Shipping your goods to Cambodia 79 Business etiquette, language & culture 80 • Overview 81 • Cambodian public holidays 65 87 What are the challenges? 89 • Challenges when doing business in Cambodia • Business risk 91 • Getting paid in Cambodia 71 79 87 www. Cambodia .Doing Business Guide .co.uk 5 93 Resources 93 Resources 100 The British Embassy Phnom Penh 94 What does membership of the Institute of Export & 102 Supporting organisations International Trade mean? contact details 96 About the UK-ASEAN 104 Market experts contact details Business Council (UKABC) 107 Useful links 98 Focusing on qualifications. Lesley Batchelor OBE, FIEx 111 Trade shows (Grad) – Director General, Institute of Export & 112 Map of Cambodia International Trade 115 Quick Facts SUPPORTING ORGANISATIONS b s e t e . E + 0 Visit the Website and download the free Mobile App Cambodia overview th Cambodia is one of the fastest-growing economies in Southeast Asia and currently ranks 11 in the world in terms of high GDP growth over the last decade. With a forecasted 7% economic growth per year for the next five years and a rapidly growing consumer class that is earning triple the average income, it is an attractive market to invest and do business in. With this growth in earnings comes a growth in disposable incomes. Borders are opening up, trade is increasing, and there are many more products to buy. Products, and brands, represent a connection to the wider world, and the promise of a successful and prosperous future. Its young population, half under the age of 25, is tech-savvy and worldly, and against this backdrop, tastes, preferences and habits are forming, and changing rapidly. The young population are driving new product preferences, and are leading the way in the adoption of new technologies. Significant opportunities are available for businesses in a number of different sectors. UK companies are finding opportunities in education and vocational training, construction, manufacturing, retail, automotive, agribusiness, tourism and the financial/professional services. However, doing business in Cambodia takes patience and perseverance. Companies should be prepared to invest time and resources in regular visits over a period of months, sometimes years, before seeing returns. MARKET EXPERTS Thank you to our Market Experts www. Cambodia .Doing Business Guide .co.uk 7 www.export.org.uk @ioexport Choosing a great export training partner can really help your company take off in the export trade! We can help develop new ideas and find ways to drive down costs and produce sustainable improvements in your export business. Join us today Membership : Training : Qualifications : Advice Call: +44 (0) 1733 404 400 : email: [email protected] Welcome from Lesley Batchelor OBE, FIEx (Grad) – Director General, Institute of Export & International Trade The new Doing Business in Cambodia Guide introduces a rapidly growing market with a great strategic location within Southeast Asia. While it may not be as well known to us as Thailand and Vietnam, the UK is Cambodia’s second strongest export partner with trade valued at over $900 million in 2016 according to the World Bank. With 7% annual growth over the last five years, it’s estimated that Cambodia will become an upper-middle income country by 2030. Half of its 15.8 million population are under 25 and the young generation coming through are tech-savvy and avid users of social media platforms like Facebook and YouTube. This is having a significant impact on Cambodian culture as a whole and opens up new opportunities and routes to market. Cambodia joined the World Trade Organization in 2004 and trade with the EU is framed by broader ASEAN-EU dialogue. Bordering Laos, Thailand and Vietnam makes it a strategic entry point into the ASEAN region, which as a whole is home to over 600 million people and is the UK’s 3 rd largest trading partner after China and the EU. Cambodia is a well-known exporter of clothing and footwear, so is unsurprisingly a major importer of textiles and fabrics. In recent years imports of pharmaceutical products, machinery and construction materials have also been on the rise. The Cambodian Government is investing in infrastructure with transit routes, power and intercommunications being developed across the country, and is also seeking increased overseas investment to gradually replace previous reliance on aid. Like other Southeast Asian countries, it can be a challenging market. Cambodia ranks at 135 in the World Bank’s ‘Doing Business’ ratings, and corruption continues to be an issue. It also has a business culture that values personal relationships and it is often recommended that businesses establish an in-market presence, or at least visit regularly. As always the Institute is here to support you in overcoming these obstacles and guide you through the do’s and don’ts of doing business in this fascinating market. So if you’re interested in exporting to Cambodia please do feel free to get in touch! Lesley Batchelor OBE, FIEx (Grad) Director General – Institute of Export & International Trade www.export.org.uk www. Cambodia .Doing Business Guide .co.uk 9 Foreword from Mr Bill Longhurst, British Ambassador to Cambodia Cambodia has made a remarkable recovery from its darkest years under the Khmer Rouge regime in the 1970s. The country still faces development challenges, including relatively high electricity and logistics costs, coupled with election-related uncertainty. However, two decades of growth at 7.6%, 1994 to 2015, led to the Asian Development Bank describing Cambodia as “Asia’s New Tiger” in 2016, after the Kingdom became ranked by the World Bank as a lower middle income country. The high rate of growth and ongoing drive towards diversification of the economy presents a myriad of opportunities for British companies. Cambodia’s growth has been fuelled by expanding exports of garments and footwear in addition to a rise in diversified exports, such as machinery, auto parts and equipment, together with rapidly accelerating tourism and financial sectors. Bilateral trade of goods with the UK in 2016 is valued at $1.3 billion USD albeit heavily weighted in favour of Cambodian exports of which roughly 90% were textiles, clothing and footwear valued at $1.17 billion USD. The UK is committed to developing trade with Cambodia and assistance for UK companies looking to enter the market can be offered by the Department for International Trade, in partnership with the British Chamber of Commerce, based in Phnom Penh. ASEAN is projected to become the world’s 4 th biggest economy by 2030 with Cambodia playing its part. Having enjoyed the highest GDP growth rate of all ASEAN nations (7% in 2016) why not explore its opportunities? Mr Bill Longhurst British Ambassador to Cambodia https://www.gov.uk/world/organisations/british-embassy-phnom-penh www. Cambodia .Doing Business Guide .co.uk 11 Introduction from Romdoul May, Director of the Department for International Trade, Cambodia The Department for International Trade works closely with the British Embassy Phnom Penh to promote and facilitate trade between the UK and Cambodia. We offer bespoke assistance for UK companies wishing to enter the Cambodian market, in partnership with the British Chamber of Commerce, which can facilitate a channel to a strong business network across Cambodia and Southeast Asia. We can also provide guidance on access to UK Export Finance, that will catalyse UK exports to Cambodia’s burgeoning economy. There are many opportunities to be seized in Cambodia, especially in education, infrastructure, agri-tech, energy, transport, and luxury goods and vehicles. We encourage UK companies to explore the numerous business prospects in Cambodia and will support their efforts to do so! Kind regards, Romdoul May Director of the Department for International Trade, Cambodia https://www.gov.uk/world/organisations/department-for-international-trade- cambodia www. Cambodia .Doing Business Guide .co.uk 13 Introduction from Ross Hunter, Executive Director, UK-ASEAN Business Council Cambodia is among the fastest growing economies in the world, averaging just over 8.2% annual growth for more than a decade.
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